The Case for Expanding the Convention Center

February 21, 1993|By MARK K. JOSEPH

"It's the economy, stupid!" read the brusque, handwritten placard in Bill Clinton's election campaign headquarters. The sign was an ever-present reminder to Candidate Clinton not to stray too far from the nation's ailing economy as the overriding issue that would propel him past George Bush to the presidency.

Members of the Maryland General Assembly might do well to heed that same admonition as they prepare for the debate over whether to expand Baltimore's Convention Center. By early April, after all of the inevitable questions have been asked, after all of the political posturing is done, after all of the quid pro quos have been negotiated, the expansion of the Convention Center will rise or fall on its benefit to Maryland's economy.

On those terms, the case for expansion is a strong one. Since the city of Baltimore, with a critical assist from the state, first entered the convention and trade show business in a serious way in 1980, the Convention Center has served as an impressive catalyst for the region's and state's economy, spawning thousands of new jobs, millions of dollars in capital investments and nearly a quarter of a billion dollars in total yearly economic impact.

For example, the original center generated new state tax revenues totaling $58.5 million in its first 11 years of operation -- $6.6 million more than the total cost of building the center. Every year since 1990, another $12 million to $15 million in taxes directly attributable to the Convention Center have been added to the state's general fund coffers. This money represents, in essence, pure profit to the state. Moreover, the jobs of 6,700 workers throughout Maryland exist because of the business created by the convention trade.

Indeed, the effects of the Convention Center in Baltimore reverberate throughout Maryland's economy. More than $1 billion has been invested in building and refurbishing hotels in downtown and the surrounding counties since the original center opened in 1980, creating valuable jobs and economic activity. Out-of-town visitors to conventions and trade shows fill the bulk of the 5,000 hotel rooms in downtown and many of the 13,000 hotel rooms in the metropolitan area.

But the Convention Center does not benefit just Baltimore. Ask Jim Biggar, the newly arrived general manager of Stouffer Harborplace, the large Inner Harbor hotel which provides jobs to 530 workers. Last year, Stouffer's bought 30 tons of chickens produced by farmers in Wicomico County. Three grocers based at the wholesale produce and seafood market at Jessup sold $1 million in fruit and vegetables to Mr. Biggar's hotel in 1992. In 1991, Mr. Biggar's predecessor wrote out checks for $1 million for Eastern Shore crabs, oysters and fresh fish.

That's just the impact from one hotel in downtown Baltimore which is dependent on visitors to conventions and trade shows for a crucial chunk of its business. Multiply Mr. Biggar's numbers by the other hotels in downtown and in neighboring counties as well as the dozens of restaurants that cater to the convention trade.

A 1988 study by the Maryland Department of Economic and Employment Devel opment estimated that the direct economic impact of tourism related to the convention trade at $10.5 million annually in Central Maryland, plus $3.4 million in employee income. Far less apparent, but no less important, are the dozens of companies of all types which serve the Convention Center, the center's events or the major downtown hotels.

Eight of these businesses, located in Southwest Baltimore County and employing 672 workers, attributed as much as 91 percent of their business to serving the Convention Center and hotels, with a total value of $8.2 million.

Five companies surveyed in the 13th Legislative District, around Laurel, valued their convention-related trade for as much as half of their total sales, or more than $14.1 million last year. Those five companies employed 193. And that doesn't include the 700 jobs at the wholesale produce and seafood markets at nearby Jessup.

Unless Baltimore's convention facility is enlarged, this critical economic engine is imperiled. Decisions being made by convention planners over the next 90 days will affect Baltimore in 1998 and 1999. For instance, Baltimore is on the short list of cities being considered to host three large events, each of which would bring in 5,000 out-of-town visitors and require 2,500 hotel rooms. But, none of these three events can be accommodated by the present center.